AboutMichelle Dunn Expertise As one of the Top 5 Women in Collections, one of the Top 50 Collection Professionals of 2007, and winner of the 2007 Business Excellence award, I can answer any questions about debt, debt collection, improving business credit, creating a credit policy, enforcing a credit policy and collecting on past due accounts. I can also answer questions in regards to starting a debt collection agency since I have been a bill collector for over 21 years, started and ran my own collection agency for 8 years, and maintain my 11 year old American Credit & Collections Association for members of the credit & debt collection industry. I am also the author of the popular and award winning book "Starting a Collection Agency, how to make money collecting money" now on it's 3rd edition. This book has won a the Writers Digest self published award as well as the 2007 New York Book Festival Award.
I am a repeat contributor to the Wall Street Journal, and have been featured on NPR as well as many other national radio and television programs. I have also been featured in national publications such as the Wall Street Journal, Forbes, Smart Money, MSNBC and much more. I have 12 published books to my name and am an accomplished speaker and consultant. I currently write 9 columns for newspapers, magazines and online portals worldwide.
Experience I have over 21 years experience in debt collection, I started and ran my own collection agency for 8 years and I am the Executive Director of my American Credit & Collections Association that I founded in 1998. www.credit-and-collections.com
Organizations The American Credit & Collections Association LLC, I was also a member of the American Collectors Association and Plymouth Chamber of Commerce for 9 years. I am a member of many writing groups as well as my local Women Inspiring Women chapter. I am a member of Know More Media as an expert for their blog on business credit.
Publications Business NH Magazine, Smart Money Magazine, MSNBC, CNN, Forbes.com, The Wall Street Journal, Home Business Magazine, Entrepreneur Magazine and website, many books, newspapers and television programs as well.
Education/Credentials I have written 12 books in my collecting money series and one for Entrepreneur Press called the Ultimate Credit and Collections Handbook.
Awards and Honors My book Starting a Collection Agency, how to make money collecting money won an award from Writers Digest and the 2007 New York Book Festival in the "How to" category. I have won 2 awards from Dun & Bradstreet and Governor Jean Shaheen. I was nominated as one of the Top 5 Women in Collections in 2007 as well as having been selected as one of Collection Advisor's Top 50 Collection Professionals for 2007.
Question I am a credit & collection specialist of one the prestigious real estate firm here in the philippines...in related to this, I would like to ask some help from you on how to improve our collections from our delinquent clients. Can you give me some new techniques and ideas to improve our department? I will really appreciate your fast response. Thank you very much.
Answer Aprille,
I know many of you are desperate for a quick fix because suddenly many of your customers are losing their jobs or getting behind on payments so I have listed 6 easy steps you can take today to help boost your credit policy and keep your customers on their toes.
1. Print out or buy Credit Applications (http://www.michelledunn.com/free.html)
2. Put them on a clip board at your front desk or door, or on your website.
3. Have every new customer fill one out.
4. Mail one to every existing customer, with a stamped addressed envelope
5. Check ALL references
6. Email me with any questions
If you didn’t have a credit policy before, and then if you printed out a sample credit application and start taking these steps, congratulations because you have one now. Credit policies don’t have to be difficult and confusing; they can be as simple as you want. Not having a credit policy is a recipe for disaster, which many companies will be finding out as the recession worsens.
Your credit policy will be based on your terms, due dates and what you want to happen when a customer is late or doesn’t pay. Some things to think about when you are setting your payment terms:
• How often do you want to get paid?
• Do you want to be paid upon completion of the work, or would you like to offer 30 day terms?
• Maybe you want to offer 30 day terms with a discount if the invoice is paid in full within 10 or 15 days.
Some people really don’t think about when they want to be paid, when will receiving that money benefit you and your business the most? Maybe right before your bills are due so you have the cash on hand to pay your bills on time or early taking advantage of early pay discounts thus saving even more money. When setting your due dates, no matter what you decide on for terms, choose a time of the month that you want to be paid, such as the first of each month, the 15th or any date that works best for your business.
Now really put yourself into this scenario. Your sitting at your desk and a customer that you really thought would pay you is past due and avoiding you. The balance is quite large and the debt is getting older and older. What do you want to happen when your customer is late or doesn’t pay you?
• Do you want their credit to be revoked?
• Do you want their account to go on hold for future orders until this is paid?
• Do you want a phone call to be made or a letter to be sent?
Once you have a past due customer or a bad check, here are the steps that can be taken when customers are past due, over their credit limit or bouncing checks.
• Refer to your Credit Policy
• Make a collection phone call
• Send a friendly (or not so friendly) reminder
• Revoke credit
• Stay on top of your accounts receivables and follow up with anyone you contact
If you are still having trouble with an account go back to the sales department and talk to whoever made the sale.
• Sales will have gathered information on what the customer can and cannot afford – Do not oversell!
• When an account is past due have the sales person who made the sale contact the customer.
The least popular method to getting the sales department to help collect is to withhold commissions on sales until customers have paid for the item in full.
